Wholesale Broker
What Is a Wholesale Broker?
A wholesale insurance broker acts as a middle person between a retail broker and an insurance carrier for insureds with niche or hard-to-cover risks. Unlike the retail broker and carrier, they don’t have any contact with the insured.
How Does a Wholesale Broker Fit Into Insurance?
Wholesale brokers are the intermediaries agents turn to when their client (the policyholder) has risks that are too unusual, complicated, or undesirable for standard insurance programs.
Most retail agents don’t have direct access to surplus lines carriers or specialty programs that cover hard-to-place risks, but wholesalers do.
A typical insurance transaction involving a wholesale broker looks something like this:
Swipe →
| Role | Who They Work With | Main Roles |
|---|---|---|
|
Retail agent/broker |
You (the policyholder) and wholesalers/carriers |
Helps you find coverage, explains options, and services the policy |
|
Wholesale broker |
Retail agents/brokers and carriers |
Finds coverage from specialty or surplus lines insurers |
|
Insurance carrier |
Retail agents, wholesalers, and sometimes large insureds (e.g., major corporations) |
Underwrites/issues the actual policy and pays covered claims |
TL;DR: You talk to your retail agent about your business’ risks and coverage needs, and then your agent may talk to a wholesale broker to reach more specialized insurance companies.
What Is a Wholesale Broker vs. a Retail Agent?
Retail agents work directly with policyholders, collecting information about their business and its risks. Wholesale brokers work with those retail agents to help them find specialty or surplus lines carriers for their clients.
Who They Serve
- Retail agent/broker: Businesses and individuals (like your small business)
- Wholesale broker: Retail agents and brokers, not the general public
Main Relationship
- Retail agent/broker: Advises and supports the policyholder
- Wholesale broker: Helps the retail agent access specialty markets
Access to Insurance Markets
- Retail agent/broker: Standard/admitted markets and some specialty
- Wholesale broker: Specialty, niche, and surplus lines markets
Typical Communication With You
- Retail agent/broker: High frequency; quotes, questions, policy changes, and help with claims
- Wholesale broker: Low to none; works behind the scenes with your agent
Featured On Your Documents
- Retail agent/broker: Yes, often prominently
- Wholesale broker: Sometimes in fine print, invoices, or policy information
TL;DR: Wholesale brokers expand your agent’s toolbox, but they don’t replace them in the process.
Why Does My Policy Need a Wholesale Broker?
If your business has niche or hard-to-place risks, your agent may need to work with a wholesale broker to find a carrier that can cover them. This includes:
- Businesses with prior losses
- Hazardous businesses, such as construction, trucking, or cannabis
- New ventures or startups
The standard carriers your agent works with might say no to covering your risks, but a wholesale broker could know who’d say yes.
Here’s what you need to know if your policy uses a wholesale broker:
- Your main contact is still your retail agent: Questions, changes, and claims usually go through them
- Needing a wholesale broker doesn’t mean your business is “bad”: It usually means you’re in a niche or specialty area that standard carriers don’t cover
- You may see extra names or fees on quotes and invoices: Ask your agent to explain how pricing and fees work to avoid surprises
- Coverage can come from surplus lines or specialty carriers: These markets can handle risks that standard insurers won’t
- You likely won’t ever speak with your wholesale broker: They work with your agent and the insurer on the backend
Related Terms
- Retail broker
- Retail agent
- Excess lines
- Carrier/insurance company
- Underwriter
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